The initial public offering (IPO) of steel major RINL is likely to hit the capital markets on July 3,starting the government’s Rs 30,000-crore divestment programme for the current fiscal.

By diluting its 10 per cent stake in Rashtriya Ispat Nigam Ltd (RINL),the government is aiming to raise about Rs 2,500 crore.

“RINL IPO is expected to be launched in the first week of July,most likely it will open on July 3 and close on July 6,” a source in the know said.

The company would file its draft red herring prospectus (DRHP) on May 17 with the market regulator SEBI,the source added.

The Cabinet Committee on Economic Affairs in January had approved disinvestment in RINL. The company has appointed four merchant bankers — UBS Securities,Deutsche Bank,Edelweiss Capital and IDBI Capital — as the book-running lead managers to manage the IPO process.

Last month,the steel major increased its production capacity to 6.3 million tonnes per annum (MTPA) from its earlier capacity of 2.9 MTPA with an investment of Rs 12,500 crore.

Besides,shareholders of RINL had also approved stock split in the ratio of 1:100 of the company last month. This means that one share with a value of Rs 1,000 would get split into 100 shares worth Rs 10 each.

The move is expected to help the company in ensuring wider retail participation in its proposed IPO.

The proposed share sale would also help RINL in retaining its Navratna status,which was accorded on November 16,2010,subject to the condition that it would get listed in two years (from the date of acquiring the status).

The other PSUs lined up for disinvestment in the current fiscal include SAIL,Hindustan Copper,Oil India and Hindustan Aeronautics.

Last fiscal,the government had to postpone share sale plan of the PSUs due to volatility in the capital markets. It managed to raise only Rs 14,000 through disinvestment in FY 2012 against a target of Rs 40,000 crore.